Bitcoin ($BTC) is not just a digital asset but also a story of historical volatility and surprises. Looking back at the year-end holidays over the past 4 years, we can draw important common points and attempt to predict the future based on past trends.

2020 - Mid Bull Market

The year 2020 marked a strong comeback for Bitcoin. With increasing acceptance from major institutions and global monetary easing policies after the COVID-19 pandemic, Bitcoin soared from below $10,000 at the beginning of the year to over $29,000 by year-end.

Main reason:

  • Increased demand from major institutions like MicroStrategy and Tesla.

  • The story of "digital gold" has gained popularity.

  • Economic stimulus policies and money printing from central banks.

2021 - Beginning of Bear Market

In early 2021, Bitcoin continued to reach a peak near $69,000, but then the bear market cycle began in mid-year. By the end of 2021, Bitcoin's price dropped to around $47,000, marking the transition from a bull market to a bear market.

Reason:

  • The market is affected by natural corrections.

  • Concerns about government regulations (China banning Bitcoin mining, the US tightening cryptocurrency oversight).

  • Liquidity is gradually drying up as money flows out of the crypto market.

2022 - Near End of Bear Market

2022 was a challenging year for Bitcoin as the price fell to a low of around $15,500. A series of negative events such as the collapse of LUNA/UST, Celsius, and finally FTX severely undermined investor confidence.

Negative factors:

  • The cascading collapse of major cryptocurrency companies.

  • Fear-driven sentiment dominates the entire market.

  • High interest rates from the US Federal Reserve (FED) put pressure on risky assets.

2023 - Mid Bull Market

The year 2023 witnessed Bitcoin gradually recovering, with prices exceeding $30,000 by mid-year. Interest returned as major funds like BlackRock filed for a Bitcoin Spot ETF and the market received positive signals from economic reports.

Bright spots:

  • Signs that the market is entering the first half of a bull market.

  • The interest from major financial institutions.

  • Macroeconomic factors, such as the FED's forecast to slow down interest rate hikes, support the recovery of risky assets.

2024 - Where Are We Now?

Based on the 4-year cycle, Bitcoin tends to move through stages:

  1. Accumulation.

  2. Strong price increase.

  3. Strong correction.

  4. Recovery.

Currently, we may be in the middle of a bull market, where the market still has growth opportunities. However, 2024 is particularly significant as it is the year of Halving, an event where the Bitcoin mining reward will be halved. Halvings have historically always been a signal that triggers a major bull market.

Predictions for 2024:

  • First half of the year: The market continues to accumulate with mild volatility, depending on macroeconomic conditions and FED policy decisions.

  • Second half of the year: Bitcoin is likely to enter a strong bull phase after the Halving event, aiming to break previous resistance levels ($69,000).

Risks to watch out for:

  • Legal and regulatory risks remain, especially regarding SEC actions.

  • Market sentiment can change rapidly in response to major events.

Conclusion

History shows that Bitcoin always moves in cycles. Based on what has happened, we can expect a stronger price increase in the coming months, especially after the Halving event. However, investors need to prepare for unforeseen volatility and manage risks carefully.

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